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Will Fed's 'Easy Money' Push Up Prices?

By

David Wessel

Updated Jan. 17, 2013 3:52 p.m. ET

TheFederal Reserve has held short-term interest rates near zero for four years. It expects to keep them there for another couple of years. It has printed money—more than $2 trillion—and pumped that into the economy.

There is no sign of inflation—yet. Consumer prices have risen only 1.7% in the past year. But is inflation inevitable from this extraordinarily expansionary monetary policy?